Tax Credits. Do you understand them?

[2nd time mum]

Hi ladies

As the thread asks do you know how they work? I personally think it is a law to itself the way it works. I returned to work at the end of March from maternity leave and phoned them to let them know and also because we have childcare. Luckily they are paying towards childcare as I work full time and OH works part time.

I got the renewal pack yesterday which was great because I could get last year's salary sorted out and this years too.

I had phoned tax credits before because we got paid a stupid amount of money into my account and when I phoned them they said they would (grudgingly!) take my new salary into account so I thought that was that and the following week the tax credits would be reduced only to check the Bank the following week and it had went up by another £20! All OH details were right because he doesn't earn too much just now.

So yesterday when updating I told the girl about how I thought we were getting too much money and she said that they had my correct salary details and OH's but tax credits are based on previous years earnings. So then I thought what will happen next year and asked why they won't do it on this years salary because I don't want to be due them money and have reduced payments. The girl checked with her supervisor and said there wouldn't be any overpayment because I updated everything properly.

How can this be? How can they pay so much money out when my earnings are almost treble what they were last year because of being on mati leave.

Anybody else in the same position?xx

 

[miss.kayleigh]

i don't get it and they don't talk much sense when you ring them either do they! i get random amounts in my bank it drives me mad as i never know how much to expect and weather we'll be able to afford nursery etc!

 

[// arcadia]

Im not really sure .. way i look at it is you give them previous years details they pay you according to those details .. so last year you where on maternity which is pretty rubbish pay so your getting lots of tax credits this year - then next year you give this years pay which will be good so you'll get less .. but i dont think you should owe any money ??

Or am i totally wrong

 

[2nd time mum]

Im not really sure .. way i look at it is you give them previous years details they pay you according to those details .. so last year you where on maternity which is pretty rubbish pay so your getting lots of tax credits this year - then next year you give this years pay which will be good so you'll get less .. but i dont think you should owe any money ??

Or am i totally wrong

It just seems strange doesn't it?! Last year we totally struggled although they changed our details now we are getting money thrown at us and we are both working!! I just want to make sure I won't be due them money or get next to nothing next year because they would want some back.

Thanks

 

[2nd time mum]

i don't get it and they don't talk much sense when you ring them either do they! i get random amounts in my bank it drives me mad as i never know how much to expect and weather we'll be able to afford nursery etc!

Yeah anytime I phone you wonder if they know! They never sound too confident and always double check with a supervisor. Thanks

 

[// arcadia]

Im not really sure .. way i look at it is you give them previous years details they pay you according to those details .. so last year you where on maternity which is pretty rubbish pay so your getting lots of tax credits this year - then next year you give this years pay which will be good so you'll get less .. but i dont think you should owe any money ??

Or am i totally wrong

It just seems strange doesn't it?! Last year we totally struggled although they changed our details now we are getting money thrown at us and we are both working!! I just want to make sure I won't be due them money or get next to nothing next year because they would want some back.

Thanks

I know that when you go on maternity you can call to give an estimated amount you will get for that year and they adjust it there and then so you dont struggle, i never did this though wish i did.

I think as long as you update them with every single change and give them accurate wage details and document every phone call and who you spoke to then you should never owe money - they should pay you only what you are entitled too.

 

[lorrilou]

Every year when we've put done our tax credits renewal we have ended up owing them money, as our earnings have always gone up. this year they should owe US for a change!!

I dont understand how they work though, when i lost my job at the beginning of last year and informed tax credits, they stopped my payments all together?!!!!!

 

[PleaseBaby]

It's worked out on the previous years salary so next year it will be lower because they'll be using this years salary, you can ask them to work it out on your current years if it's significantly deifferent I think its for 25k and above

 

[sheridon1984]

Just my own little rant but to me tax credits are a joke!! When I looked online to find out about how to get the forms it said go to your local job centre, so I did that and got scared to death by a bouncer type person who jumped out at me, then I was told that they don't give the forms out - you have to ring up as they want to police who they are sending them too.
So I ring up, had to go through details of this years income over the phone before the lady would send them out. They arrived and were none of the questions that I was asked on the phone, they were last years earnings. To top that off when I spoke to my friend about it she said she just rang and they sent them out - no questions asked!

In my opinion the thresholds are all wrong, what is the point of having the threshold at x amount and you earn more than that but you actually only receive less than the threshold by the time you are taxed.

I had hoped that we would get some help towards our childcare but they wont even give that, we will be spending £3,200 on 2 days a week for a year and our parents are doing 2 days each f.o.c obviously.

Drives me crazy and sorry to hi-jack your thread abit!

 

[Fabmumof3]

Tax credits start off on your 1st year by taking last years earnings into account. After that oyu can phone them up any time and update them as to what you expect to earn this year (me and friends have done this). Were you on maternity pay last year coz they dont take the 1st £100 a week into account so you get more in tax credits. You can check the online calculator at www.inlandrevenue.gov.uk go into tax credits then online calculator. I update mine all the time and ive never been overpaid.

 

[Blah11]

I agree, it makes no sense. I'm going to get a lot more money this year cos last year i was on mat leave. However, i needed the extra money when i was on mat leave, not now senseless.

 

[2nd time mum]

Just my own little rant but to me tax credits are a joke!! When I looked online to find out about how to get the forms it said go to your local job centre, so I did that and got scared to death by a bouncer type person who jumped out at me, then I was told that they don't give the forms out - you have to ring up as they want to police who they are sending them too.
So I ring up, had to go through details of this years income over the phone before the lady would send them out. They arrived and were none of the questions that I was asked on the phone, they were last years earnings. To top that off when I spoke to my friend about it she said she just rang and they sent them out - no questions asked!

In my opinion the thresholds are all wrong, what is the point of having the threshold at x amount and you earn more than that but you actually only receive less than the threshold by the time you are taxed.

I had hoped that we would get some help towards our childcare but they wont even give that, we will be spending £3,200 on 2 days a week for a year and our parents are doing 2 days each f.o.c obviously.

Drives me crazy and sorry to hi-jack your thread abit!

Hijack away! It is interesting to know what others go through. There seems to be so many problems with the system that it is absolutely unbelievable. I had a teenager too and when the equivalent system was in place you applied every 6 months and the amounts were fixed for that time. It was a much better system and stopped people being in arrears to the Government!

 

[2nd time mum]

It's worked out on the previous years salary so next year it will be lower because they'll be using this years salary, you can ask them to work it out on your current years if it's significantly deifferent I think its for 25k and above

So because my salary is under the £25k I get it based on last years money but if I was earning over £25k they would work on that salary?

 

[MummytoOscar]

Ok now I'm really confused and worried!

Oscar is 2 and up until now I haven't claimed WTC or CTC. As of next month my hours at work will reduce to 3 day a week and my salary will be halved. We are really going to struggle but due to me being ill I am forced to reduce my hours or else I may have to give up work altogether. (something that I REALLY don't want to do )

So I have been waiting for my change in hours to go through before I claim for CTC & WTC, now I thought that WTC would be less with my reduction of hours as it is to go towards Oscars nursery fees (do I have that right?) So I figured CTC would then rise?

From what you ladies have been saying on here it sounds like I will eventually get less help because I'll be earning less?! I'm lost

Is that really how it works with tax credits?

 

[starbucks101]

what on earth is the 25k disregard!

 

[2nd time mum]

what on earth is the 25k disregard!

I think it means that if my salary was over £25,000 they would take it into account to sort out my tax credits for this year but because it's not they will go on last year's salary